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Jon Greenberg
By Jon Greenberg July 31, 2013

Obama says Keystone XL would mean "maybe 2,000 jobs"

The Keystone XL pipeline that would carry oil from Alberta, Canada, to refineries on the Texas Gulf coast presents President Barack Obama with no easy choice.

While officially, the final decision to block or approve it is in the hands of the State Department, politically, the plan pits two key Democratic constituencies against each other, environmentalists and organized labor.

For the first group, extracting petroleum from Canadian tar sands is a climate change disaster. For the unions, the project means jobs.

Fresh off a speech that underscored the need to restore America’s middle class, Obama talked about the steps that lie ahead for the 875-mile link between the Canadian border and a distribution hub in Nebraska. The central question, he said in an interview with the New York Times, is whether this would "significantly contribute to carbon in our atmosphere."

As for jobs, the president went out of his way to downplay them. In the big picture, they were but a "blip", as the president put it.

"Republicans have said that this would be a big jobs generator. There is no evidence that that’s true," Obama said. "Any reporter who is looking at the facts would take the time to confirm that the most realistic estimates are this might create maybe 2,000 jobs during the construction of the pipeline -- which might take a year or two -- and then after that we’re talking about somewhere between 50 and 100 jobs in a economy of 150 million working people."

There’s been a running battle over jobs and the Keystone XL. We’ve checked claims that it would employ as many as 20,000 workers. We rated that False; even the company behind the pipeline backed away from that number.

To be clear, there are all sorts of complications when it comes to predicting how many jobs a complex, two-year project will generate. There are the direct construction jobs; there’s indirect employment at companies that provide the materials and services related to the work; and then there’s the really indirect effect that comes when money is pumped into an economy and people buy food and pay rent and so on.

But out of all the numbers bruited about, the president’s seemed particularly low.

We asked the White House for evidence to support the claim. All they offered was a statement from spokesman Josh Earnest during a press briefing.

"There are a range of estimates out there about the economic impact of the pipeline," Earnest said. "What the president is interested in doing is draining the politics out of this debate and evaluating this project on the merits."

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During the New York Times interview, the president invited reporters to use the most realistic estimates. So we went to the State Department’s lengthy environmental impact statement on the project that came out in March. In that report, the lowest estimate for jobs directly tied to construction was 3,900 jobs a year.

That number came after analysts wrestled with the stop-and-start nature of construction work and converted the jobs to a yearly estimate. "Approximately 10,000 construction workers engaged for 4-to 8-month seasonal construction periods (approximately 5,000 to 6,000 per construction period) would be required to complete the proposed project. When expressed as average annual employment, this equates to approximately 3,900 jobs."

The analysis noted that 90 percent of those jobs would come from "a unique national labor force that is highly specialized in pipeline construction techniques." It also confirmed that there would be few long-term jobs, something on the order of 35.

The largest jobs number in the State Department report is an annual average of 42,100, but that includes part-time jobs and folds in the ripple effects as spending moves through the economy, measured over two years. The further out from the immediate project the analysis moves, the less certain the results. The report said these jobs would amount to 0.02 percent of total American employment, adding some weight to the president’s characterization of the impact on the overall jobs picture.

The North American Building Trades Union said it was disappointed with Obama’s words and pressed him to let the pipeline move forward.

"So that workers and their families can share in the economic recovery he is touting," said union president Sean McGarvey. "The president should look to his own State Department’s findings that there will be meaningful job creation."

We looked at the website of the Sierra Club, one of the leading environmental groups opposed to the pipeline, and they used the State Department’s 3,900 annual number.

The only place we found anything close to the president’s figure was at the Cornell School of Industrial and Labor Relations Global Labor Institute. Assistant director Lara Skinner co-wrote a report highly critical of the pipeline. Skinner argued that the 3,900 covered employment for two years and that it should be divided in half. "That's where the 2,000 job figure comes from," Skinner said.

However, if that is what the State Department had meant, the White House could have easily referred to it to support the president’s claim.

Our ruling

Obama said the Keystone XL pipeline might produce about 2,000 jobs during construction, based on the most reliable estimates. The White House provided no supporting evidence and the administration’s own State Department predicted that while the pipeline would produce few permanent jobs, the construction process itself would create nearly twice as many jobs as the president said.

We rate the statement False.

Our Sources

New York Times, Interview with President Obama, July 27, 2013

White House, Press briefing, July 29, 2013

U.S. Department of State,Draft environmental impact statement - supplemental Keystone XL pipeline, March 8, 2013

Sierra Club, Keystone XL 101, 2013

Cornell Global Labor Institute, "Pipe Dreams? Jobs Gained, Jobs Lost by the Construction of Keystone XL," January 2012

PolitiFact Oregon, Rep. Greg Walden says Keystone XL pipeline would create 20,000 'American jobs' with 800 in Oregon, February 27, 2013

PolitiFact Georgia, Isakson: Keystone pipeline to employ 20,000, April 11, 2012

Email interview with Lara Skinner, associate director, Cornell School of Industrial and Labor Relations, Global Labor Institute, July 29, 2013

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Obama says Keystone XL would mean "maybe 2,000 jobs"

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